Middle class & living paycheck to paycheck

[dmcowen674]

5-1-2014

http://money.cnn.com/2014/04/25/news/economy/middle-class-paycheck/index.html?source=yahoo_hosted

Middle class & living paycheck to paycheck



More than 25 million middle class American families are living paycheck to paycheck.



About one-third of American households live "hand-to-mouth," meaning that they spend all their paychecks


But what surprised the study authors is that 66% of these families are middle class, with a median income of $41,000.


"We don't expect them to be living paycheck to paycheck," said Greg Kaplan, study co-author and assistant professor of economics at Princeton University.

 

[dmcowen674]

These so called economic financial professors are not rocket scientists I see.

 

[Doc Savage Fan]

These so called economic financial professors are not rocket scientists I see.

ROFL. Oh the irony!

 

[thraashman]

These so called economic financial professors are not rocket scientists I see.

Um ... if they WERE rocket scientists, I feel their knowledge of economics and finance would likely be pretty lacking. Except perhaps as it pertains to rocket propulsion.

 

[smackababy]

If they are truly living paycheck to paycheck, they are living at the tail end of their means, which is stupid. This has nothing to do with how much money you make (unless you're extremely poor). I could live paycheck to paycheck making $200,000 a year in the lowest cots of living area in the country.

 

[Zaap]

I could live paycheck to paycheck making $200,000 a year in the lowest cots of living area in the country.

I know people who do this at around the $150k range.

 

[squarecut1]

Student loans have a lot to do with it too. It is not all frivolous spending, at least for some.

 

[brianmanahan]

Um ... if they WERE rocket scientists, I feel their knowledge of economics and finance would likely be pretty lacking. Except perhaps as it pertains to rocket propulsion.

the basics of economics and finance are easy enough that everyone should know them

but apparently about one-third of american households do not

 

[k3n]

deleted

 

[HOSED]

Of this 66% I wonder what the average number of children is. Also how many are single parent vrs. 2 parent. People should not cry if the have multiple children with such paltry incomes.

 

[Ventanni]

$40,000 a year is not middle class. It's working class.

 

[sze5003]

I can understand if you have student loans. At the same time I know people who just blow their money on anything.

 

[Mursilis]

the basics of economics and finance are easy enough that everyone should know them

but apparently about one-third of american households do not

It's not just an issue of knowing how to manage one's finances; it's an issue of being willing to actually manage one's finances correctly. It's like a fat person may know they need to eat less and exercise more, but be unwilling to actually do it. Hard work is hard.

 

[pcgeek11]

Regardless. If you are middle class and you are living paycheck to paycheck. You are doing it wrong. It is their own fault. Even with student loans.

 

[sze5003]

Regardless. If you are middle class and you are living paycheck to paycheck. You are doing it wrong. It is their own fault. Even with student loans.

It really depends. I like to think sometimes I'm living like that but I do actually have some money left over. Everyone's situation is different. Depends on location, cost of everything else. Hell I still have the same shitty furniture from when I first moved out. Can't afford new items. Even though there is money left over I would feel better with more left over. I don't go out or spend on anything else. My money all goes to required finances.

 

[JManInPhoenix]

I know people who do this at around the $150k range.

This. Too many people are living above their means. I know people that own SUVs that cost more than their annual salary.

 

[overst33r]

"Don't buy too much house and don't buy too much car, and you've got 95% of the battle won."

 

[Doc Savage Fan]

$40,000 a year is not middle class. It's working class.

$40,000 a year is commonly considered lower middle class.

 

[PricklyPete]

I'm pretty sure budgeting is a lost art these days. I'm not saying it would be fun living on 41K, but I know it is doable.

 

[sze5003]

I'm pretty sure budgeting is a lost art these days. I'm not saying it would be fun living on 41K, but I know it is doable.

I don't really expect people making 41k or lower to have large or expensive student debt. Most people I know with that salary didn't go to school and they work other jobs like bartender, etc. They live better than I do lol.

 

[nageov3t]

not to dismiss the problem offhand, but people also have different expectations over what's required to live comfortably these days.

a generation ago, a middle class family was probably living in a much smaller house (*gasp* not having a master bedroom/bathroom suite, and children possibly required to share rooms), had 1-2 TV's instead of one in every room, only had one car, etc.

kinda reminds me of an article in the Washington Post this week, bemoaning how even families earning $100,000/year were struggling in the DC-area. meanwhile, the family they profiled had a half-dozen iPads and a $300/month cellphone bill.

 

[JManInPhoenix]

not to dismiss the problem offhand, but people also have different expectations over what's required to live comfortably these days.

a generation ago, a middle class family was probably living in a much smaller house (*gasp* not having a master bedroom/bathroom suite, and children possibly required to share rooms), had 1-2 TV's instead of one in every room, only had one car, etc.

kinda reminds me of an article in the Washington Post this week, bemoaning how even families earning $100,000/year were struggling in the DC-area. meanwhile, the family they profiled had a half-dozen iPads and a $300/month cellphone bill.

This. My wife, dog & I live in a bigger place than I grew up in - that had me, my mom & dad and two brothers.

Then: 1 tv, 1 car, 5 people

Now: 3 tvs (really, the dog doesnt watch tv), 2 cars, 2 computers, 2 kindles, 2 people

 

[Londo_Jowo]

I had to live paycheck to paycheck for couple of months (February/March/Mid April) due to my short term disability hitting the point where I was receiving 60% of my salary. Now I'm back to work all is good again.

 

[Ventanni]

$40,000 a year is commonly considered lower middle class.

That's a common misconception. Middle class starts in the 6-figure plus range. It's much more than a working class wage obviously, but it's not "rich territory" yet. Individuals who make reasonable working-class wages love to consider themselves middle class because of their success (which they've duly earned) and for the title of thinking they're middle class, but they're still working class by definition.

It is especially important to be realistic with yourself when it comes to "class definition" because of political representation. Was it not just a few years ago we had politicians masquerading around saying they wanted to boost the middle class, and people were lining up in droves in support. When it came time to pass laws, they said, "Ya'll ain't middle class, suckers!"

 

[sze5003]

Six figures for middle class? I guess if everyone you live with has made that much all their lives yea.